A group of Indonesian state-owned companies are to form a joint venture for the production of electric vehicle batteries, according to a Reuters report.

The new venture will be named Indonesia Battery Holding, and it will consist of state miners Mining Industry Indonesia (Mind ID) and Aneka Tambang (Antam), state ulility firm Perusahaan Listrik Negara (PLN) and state oil company Pertamina, said Mind ID chief executive Orias Petrus Moedak.

“We are preparing a concrete cooperation plan, so that the nickel utilisation project can start immediately to produce batteries,” the CEO said. The company would help build an industry the aims to cover all aspects of battery production, from the production of chemicals and minerals for batteries to the assembly of the battery units themselves, as well as recycling old batteries, said Orias.

This company will also form a partnership with Chinese and Korean firms on two projects valued at US$12 billion (RM49.8 billion), Orias added, without revealing further details, Reuters reported. State miner Antam will also be working on electric vehicle battery-related projects such as high-pressure acid leaching (HPAL) and rotary kiln electric furnace (RKEF) smelter projects, valued between US2-3 billion (RM8.3-12.4 billion).

An earlier Reuters report in June indicated interest from Hyundai and LG Chem for the setting up of an electric vehicle battery manufacturing joint venture in Indonesia, though details and size of the investment were not decided at the time.

In May, a BloombergNEF report found that Indonesia’s industrial electricity prices are about 11% lower than China. Aided by ample nickel, cobalt and manganese depositories, along with low labour costs as well as government subsidies, the country could reduce total battery manufacturing cost by 8% compared to China, thus making it possibly the least costly place in the region for EV battery manufacture, the report added.

The Indonesian ministry of industry said last December that it aims to begin producing electric vehicle batteries by 2022, Autonetmagz reported. The main reason for the timeline given was in order for the country to minimise reliance on other countries for the production of key EV battery components, the director of maritime industries, transport and defense equipment Putu Juli Ardika said at the time.